Corporate Governance Mechanisms, Audit Quality, and Financial Reporting Timeliness: Evidence from Listed Insurance Firms

Abstract

Timely financial reporting is essential for reducing information asymmetry, enhancing market transparency, and supporting informed decision-making. This study examines the relationship between corporate governance mechanisms and financial reporting timeliness among listed insurance firms in Nigeria. Using a panel dataset covering a seven-year period, financial reporting timeliness is measured by audit report lag, while corporate governance mechanisms are represented by board size, board independence, audit committee diligence, audit firm type, director shareholding, and institutional ownership. The study employs panel regression with Panel-Corrected Standard Errors (PCSE) to address potential heteroskedasticity and improve the reliability of statistical inference. The findings reveal that board independence, audit committee diligence, audit firm type, and director shareholding significantly reduce audit report lag, indicating that stronger monitoring mechanisms and higher audit quality contribute to more timely financial reporting. However, board size and institutional ownership do not exhibit significant relationships with reporting timeliness. The study contributes to the corporate governance literature by providing evidence from the Nigerian insurance sector, where regulatory complexity and reporting requirements make timely disclosure particularly important. The findings suggest that firms and regulators should prioritise effective monitoring mechanisms, particularly independent board oversight, active audit committees, and high-quality external auditing, to enhance financial reporting efficiency.